Press Notice 32a, Session 2005-06

The UK must do more to ensure that the EU’s negotiating position does not cause the failure of the fragile Doha trade talks, says the Commons’ International Development Committee in a report released today, '
The WTO Hong Kong Ministerial and the Doha Development Agenda', ahead of the important April 30 deadline for WTO member countries to decide on formulas for reductions in tariffs in agriculture and industrial goods.

The Doha Round of WTO trade negotiations has been promoted as the “development round”, with British ministers promising to put Africa at the top of their priorities and arguing that it was time to “kick open the door” for developing countries to allow them to trade freely with developed countries. Yet the talks have been hindered by an inconsistent approach, and delayed offers from the EU and the US.

The EU and the USA are lecturing developing countries about free trade while maintaining strong protectionism for their own markets. This is contrary to the spirit of a development round.

The Committee argues that:

- The EU needs to improve its offer on agriculture and step back from its demands on sensitive products.

- Developing countries should not be expected to fully reciprocate trade offers or have offers made dependent on their actions.

- Policy space for developing countries to decide how best to support their emerging industries was limited in the Uruguay Round: it must not be limited any further.

- Talks on services are proceeding without the necessary research or negotiating expertise in this area: the current timetable does not provide time to rectify this.

The report says, one of the few achievements of the Hong Kong Ministerial, an agreement to end export subsidies, in fact only impacts on 3.6% of Common Agricultural Policy (CAP) support.

The Committee says the US “shamefully restricted” the agreement on Duty Free, Quota Free access to its markets.

The World Bank has argued that if any more than 2% of developed countries’ products are deemed as sensitive, and therefore subject to fewer tariff reductions, the poverty alleviation impact of any Doha agreement will be “virtually eliminated”. Yet, the Committee says, Government did not even discuss the EU’s proposal to designate 8% of products as sensitive with member states.

The EU Commission’s proposal to “benchmark” services was an attempt to “change the rules at half time” which was rightfully rejected, but the Government was not sufficiently critical of it.

The UK did not use its Presidency “acceptably” in the negotiations and its support for the EU’s “grand bargain” went back on a UK undertaking that liberalisation should not be forced on developing countries.

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Malcolm Bruce MP, Chairman of the Committee, said: “This round of negotiations was always supposed to be about shaping trade for development. Yet what we see is endless wrangling around the margins on the issues that will not, in the end, benefit the poorest people. The EU must improve its offer, and there is good reason for the Commission to ‘blink first’ since in these negotiations, nothing is agreed until everything is agreed.”

“If this is to be a development round then the EU should not make its offers on agriculture, or wider market access to the EU, conditional on reciprocal non agricultural market access, services or anything else. A true development round gives developing countries unconditional access to developed countries’ markets for the widest range of products.”

“If trade is to work for development, if millions are to be lifted out of poverty as a result of increased opportunities to trade, we need to push for a political breakthrough. If the EU and its member states are committed to the principles of economic liberalism, their actions, especially toward developing countries must demonstrate this.”

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An embargoed electronic copy will be available for witnesses, Government Departments and the press from 11.00 a.m. on Tuesday 25 April. Embargoed hard copies of the Report will be available for collection by witnesses, Government Departments and the press from 7 Millbank, London SW1P 3JA and from the Press Gallery from 11.00 a.m. on Wednesday 26 April 2006.

If you would like to be emailed an embargoed copy or would like to arrange collection of an embargoed report from 7 Millbank please e-mail
steelej@parliament.uk or call 020 7219 1223.

If you would like to arrange interviews with the Chairman or Committee Members please contact the Media Officer, Jessica Bridges-Palmer on 020 7219 0724 / 07917 488 447.